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License to sell : the effect of business administration reform on entrepreneurial activity in Mexico (English)

This paper estimates the economic effects of a recent reform that simplified business entry regulation in Mexico. The reform was introduced in different municipalities at different points in time. Using micro level data, the authors find that the reform increased the number of registered businesses by 5 percent. This increase was due to former wage earners’ opening businesses. Former unregistered business owners were not more likely to register their business after the reform. The reform also increased wage employment by 2.2 percent. Finally, the results imply that the competition from new entrants decreased the income of incumbent businesses by 3 percent.

Details

  • Author

    Bruhn,Miriam

  • Document Date

    2011/02/01

  • Document Type

    Journal Article

  • Report Number

    94666

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Mexico,

  • Region

    Latin America & Caribbean,

  • Disclosure Date

    2015/03/11

  • Disclosure Status

    Disclosed

  • Doc Name

    License to sell : the effect of business administration reform on entrepreneurial activity in Mexico

  • Keywords

    wage earner;registered business;Municipalities;linear time trend;consumer price index;barrier to entry;development research group;municipality level;entry regulation;standard error;Business Registration;registration procedure;political parties;background variable;informal business;political party;monthly income;marital status;census variable;real income;average change;administrative datum;Labor Market;employment growth;previous wage;cross-country study;random sample;ruling party;benchmark value;entrepreneurial activity;consumer good;creating job;probit regression;lower price;population data;higher growth;unemployment statistic;consumer commission;municipality government;Grocery Store;output growth;logarithmic function;product price;regression results;urban municipality;price decline;wage worker;chemical production;regulated industry;public security;cross-country evidence;development policy;missing data;outcome data;price level;social security;business entry;summary statistic;retail trade;household data;zoning law;average investment;public health;average employment;Occupation;

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Citation

Bruhn,Miriam

License to sell : the effect of business administration reform on entrepreneurial activity in Mexico (English). Author accepted manuscript Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/557541468271228264/License-to-sell-the-effect-of-business-administration-reform-on-entrepreneurial-activity-in-Mexico